Weighing the Benefits of Social Media

Today this article about how successful social media has been for some accounting firms appeared in my inbox. A few hours later I read these lines in my son’s blog.

I woke up Friday morning to a text from a friend about Cliff Lee joining the Yankees. I then checked Twitter and read numerous updates from Buster Olney about Lee to New York. I continued to turn to all sources and grabbed the remote. I turned on the television….

The first source my son checked for information was Twitter!

As a result of these two items, a few things have been running through my mind:
1. I have got to figure out how to use Twitter on a regular basis
2. If social media is helping accountants gain more business surely it can help nonprofits
3. Our future clients (for our accounting firm) and future (and some current) donors for nonprofits are using Twitter as a resource
4. While I like blogging, Facebook, and LinkedIn, I don’t find Twitter as convenient but I feel like it is something I need to be involved in.
5. Are nonprofits (and accounting firms) really missing out if they aren’t involved in social media?

I was then reminded of a forwarded article from my associate Liz Vibber about social media from the very practical and informative frogloop blog. It is a very balanced, objective look at the current value of social media and where your best efforts are spent with this communication method. One of the best points the article makes is that you build community and then use that existing community to spread your word in the online world. This is a great starting point for nonprofits that aren’t quite sure what to do about social media.

I note “current value” of social media. If today’s 20 year olds check Twitter first for up to date information, perhaps 5 to 10 years from now nonprofits will see a more significant percentage of their donations come as a result of their social media communications. Both accountants and nonprofits need to figure out the best way to make social media part of their lives. But we both need to take the time to figure out where and how that is best done.

The Data (and the Donations) are in the Details

I recently spoke with a wonderful group for a wonderful organization, the Association of Fund Raising Professionals at their Lehigh Valley conference. The presentation was “Where Can Your Limited Funding Dollars Have the Most Impact: Communicating to Your Funders the Power of Their Investment in Your Organization”.

A lengthy title, but it reminds nonprofits that their funders are indeed investors. Prior to making an investment, investors will look at the investment and make sure that it delivers a good return on their money at a level of risk that is acceptable to them. What information do your investors need to determine that their money will make the most impact in your organization?

First you need to figure out where your funds have the most impact. If you have several programs you need to look at each program separately. What are the direct costs related to that program? How many people can you serve? What amount of staff time is required to deliver your services? Can you use your staff time or your facilities or your resources in a more efficient manner to serve more people?

Once you have the financial information and the data, you need to figure out the best way to communicate that to donors and grantors. Different audiences will need different types of communication. One grantor may be interested in investing in your organization because they can see that if they provide money for staff training, the staff will be able to serve 50 more people each week. Another donor may donate because you have explained that their donation of $500 will enable your organization to build a well that can bring water to 600 people every day. And another funder may appreciate your commitment to building a stable, healthy nonprofit that continually is a community resource and they are glad to add to your reserve fund because they can evidence of this stability in your financial statements.

Financial and data analysis will not only attract more donors, it will help you manage your nonprofit better. As the saying goes, “If you can measure it, you can manage it”

You Haven’t Lost Your Status Yet

If you are a small nonprofit under $25,000 and had not filed a 990 or the 990-N postcard with the IRS in the last three years by May 17, 2010 you were at risk for losing your status. However the IRS is willing to work with these small nonprofits, so go ahead and file, even if you did miss the deadline. Instructions to file and the IRS efforts to help the small nonprofits keep their status are on the IRS website in the charity section.


The impetus behind this provision is to clean up the IRS records. It is suspected that there are many nonprofits on the IRS listing that ceased doing business years ago. There is a good detailed article on this topic at Nonprofit Newswire (which is a great daily newswire service to subscribe to)



In the week prior to May 17 we looked up some area zip codes and contacted local nonprofits we knew, that were on the list in danger of losing their status. They were unaware of the IRS Form 990-N. The most common reason was that the Board Members had changed and it is likely that any IRS notifications went to a former Board Member. See this link to look up your area

Protecting your Organization from Fraud

Last week’s headlines were all too familiar. The Treasurers of two local youth basketball leagues had stolen about $159,000 from the leagues. The thefts occurred over several years. In both cases, the Treasurers simply wrote checks out of the league accounts to themselves. This story has been repeated too many times over the last several years—in youth sports organizations, Home and School Associations, churches, fire companies, nonprofits, and businesses. The theme is the same—a trusted long time employee or volunteer steals money from the organization by writing checks to their own accounts or for personal expenses.

How could this have been prevented? The rule of two. In any organization, regardless of size or whether it is staffed by volunteers or employees, at least two nonrelated people should be involved in every transaction. What does this look like?

1. If someone writes and signs checks, then someone else receives the bank statements and reviews the canceled checks. Any unusual payee names are questioned. This step alone could have prevented numerous thefts.

2. For special events when cash is collected, there are two volunteers collecting and counting the money. They sign off on the total amount prior to the deposit.

There are numerous other controls but these two alone could reduce the amount and frequency of thefts significantly.

More Health Care Premium updates from the IRS

Under the Affordable Care Act, health coverage provided for an employee’s children under the age of 27 is now tax free to the employee effective March 30, 2010. If you have a cafeteria plan or a Section 125 plan, employees can make pre-tax contributions to this plan to pay for this benefit. See more information on this topic at the IRS website.

And the 65% subsidy on COBRA health insurance premiums has been extended past March 31, 2010. This subsidy covers employees who are involuntarily separated from their jobs between September 1, 2008 to May 31, 2010 and lasts for a period of 15 months. Eligible workers pay 35% of their premium to their former employers and the employer applies for a credit of 65% on their payroll tax return. See more information on this topic at the IRS website.

Tweeting for Your Nonprofit-Seven things to consider before starting

another great article from fellow strategic consultant Liz Vibber

Having just attended a Roundtable discussion on the basics of using Twitter for nonprofit development directors, I was struck by the potential this medium has. Of course, on the flipside, I was also struck by what a huge time drain Social Media can be—with no benefit—if you don’t invest the time in creating a following for your messages.

So where does this leave one who is interested in using this medium? Here are my Seven Things to Consider:
1. First things first-create a policy. If you’re Tweeting on your own, this probably isn’t necessary-but if you’re a large organization and you are encouraging your staff to Tweet on your behalf, consider a policy that set Tweeting guidelines on number of Tweets and content.
2. Make sure you have something useful to say. Tweeting for the sake of Tweeting gets old very fast. Most people aren’t interested in knowing that the Barista of your favorite coffee shop make your latte ‘fat’ not ‘skinny’
3. Know how much is enough. I follow one guy who must Tweet 8-10 times a day…I keep following him because every once in a while he has a nice piece that is interesting. But I’m still annoyed because he clogs up my Twitter and I may soon ‘unfollow’ him as a result.
4. Know what is not enough. If you’re going to the trouble of creating a Twitter, securing a following and finding thoughtful things to Tweet, don’t lag for weeks at a time. Try to Tweet at least once a week.
5. Manage Your Tweets. Use a tool such as TweetDeck or HootSuite to manage your Followees and Followers. These tools will also allow you to track Tweets with key words or know when someone mentions or re-Tweets you. I was especially pleased to get a Thank you from a nonprofit group who recognized that I re-Tweeted them.
6. Create a following. You have to let people know you’re out there. Thoughtfully include the ‘follow me’ button on your e-mails and organization’s website.
7. Twitter is but 1. There are many social media tools out there, and more new ones coming soon. Consider the other tools at your disposal-FaceBook, Linked-In, etc. Another advantage of TweetDeck and HootSuite is they will carry your Tweets to these other mediums so you don’t have to post the same thing in multiple places.

With these things in mind, go ahead and get started. But remember, there is so much to learn everyday so keep reading and looking for opportunities to expand your knowledge base.

New Hire Credit Form Now Available

The IRS has just released Form W-11 that will help employers claim the special payroll tax exemption that relates to certain employees hired in 2010. The employees must have been unemployed 60 days prior to the hire date. The employer will then take the credit on their quarterly payroll tax returns starting with the 2nd quarter of 2010.

The credit is equal to the employers’ share of Social Security tax or 6.2% of the payroll. This equates to a credit of $3,100 on a $50,000 salary. The employees share is still withheld from their pay and remitted and this will not have an effect on the employee’s future Social Security benefits.

Additionally if the employer retains the employee for at least a year they can claim an additional credit of $1,000 on their 2011 income tax returns. Note—exempt organizations will not qualify for the $1,000 credit.

A new hire will only qualify if:

• They were unemployed for 60 days prior to the hire date


• The workers they are replacing left voluntarily or for cause or this is to fill a new position


• They are not family members or relatives.

This tax benefit has an immediate cash flow effect as the tax on these wages is not remitted to the IRS with your payroll taxes. Also there are no minimum hours that the new employee must work.

For more information see the IRS website.